Yahoo announced that beginning November 20, 2001, it will reduce its listing fees and begin charging sellers a commission fee based on the final value of an item sold. Yahoo Auctions had been free for sellers until January 2001, when it instituted listing fees but charged no commission, or Final Value Fee (FVF) as it is known to auction sellers.
The new pricing structure at Yahoo Auctions could not have come at a better time. Many auction sellers have been furious over eBay's new Checkout feature, which caused much confusion on the part of buyers and sellers and interfered with third-party auction-management software programs. Some have vowed to leave eBay and are looking for an alternative selling venue.
Yahoo's new structure is attractive to many sellers, since it cost very little to list items, and the bulk of fees are charged only if the items sell. In addition, Yahoo's new pricing remains significantly lower than eBay's pricing. For an item with a starting price of $9.99, the current Yahoo listing fee is $0.20 - whether or not the item sells; the listing fee beginning November 20th will be $0.05 plus a maximum FVF of 2%. eBay's listing fee for an item listed at $9.99 is $0.30 plus a maximum FVF of 5%.
Auction sellers have often been willing to try other sites; eBay competitors have found that the greatest challenge is the ability to attract buyers. Yahoo is one of the only sites with brand recognition that can match eBay's. It remains to be seen whether Yahoo will leverage its brand in the auction arena.
